Hey guys I thought I'd share this with you. I spoke to Jim Anill who is the Head of BMW Service Tech Training for BMWNA (He was at a presentation at my school last week) And alot of people were bomarbding him with questions, but I manage to get a couple answered and one of the few he confirmed was M dynamics, and that it does exist.
He said that one of his colleauges is going to Germany Next month to test out the New M3 in it 99% production form!

I couldn't really get anymore question's from him, as a line of kids were raping him with questions, but I did overhear him say that the New M3 will obliterate the 335i. His quote was "there will be no comparison, it will be day and night"